What killed Nokia was the rise of Android, more than IPhone. When Android started to get big, Nokia could have easily jumped aboard and become the unrivalled no 1 among Android manufacturers. Problem was, they had been so huge and were still the worlds biggest handset brand, so they thought that to protect their position the best strategy would be to push their own smartphone OS.
So first they went with updating Symbian (the OS Nokia was already running), then they pushed Maemo, then partnered up with Intel for MeeGoo. Finally they partnered up with Microsoft and ran mobile windows. At that point they had already lost most of their market share for high end phones while chinese handset makers were threatening their market share in developing countries with cheap android phones.
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